Cost of removing name from mortgage?

Intel1982

Hi there, really need some help! My girlfriend and her ex had a joint mortgage - he is still living there and has been paying the mortgage himself. He is looking to get the mortgage in his own name but wants my girlfriend to pay all the legal fees - how much would this cost? Is there anyway she can get him to pay half the legal fees? The house is in negative equity so would forcing the sale of the house end up costing more than her stumping up the legal fees if it came to it?

Any help would be greatly appreciated.

Hooloovoo

It's not as simple as that. You can't just pay to have a name removed.

The ex-boyfriend will need to apply for a mortgage in his own name. If the existing mortgage is currently in negative equity then he will be unable to re-mortgage, unless he has significant savings he can use to improve the loan to value ratio. Even then, there is no guarantee that any lender will agree to lend him the required funds - as always their decision will be based on income multiples and affordability.

Ultimately, it could require the sale of the house, at which point any remaining debt will still have to be cleared.

It's a sticky situation for your girlfriend.

Intel1982

But if he did manage to get a mortgage in his own name, what would my gf be liable to pay? We're really worried about finance as we're hoping to save for our own place. Thanks

Hooloovoo

Intel1982 wrote: »

But if he did manage to get a mortgage in his own name, what would my gf be liable to pay? We're really worried about finance as we're hoping to save for our own place. Thanks

I would say for a start she is liable to pay her half of the loss in value the house has taken so far. In the same way if the house had increased in value she would be entitled to her half of the profits. She is effectively "selling" her half of the property to her ex-boyfriend.

Assuming that they equally paid their share of the deposit and mortgage payments. If one has contributed more money to the property than the other, then it gets more complicated.

If the ex-boyfriend is willing to ignore the loss on the value of the house and move the property into his name only provided she covers the few hundred quid it will cost in solicitors fees - then she should snatch his hand off!

Remember, if he can't remortgage and the house eventually sells for less than the current mortgage then the ex-boyfriend AND your girlfriend will BOTH be liable for the FULL deficit. If he "disappears" then the bank will approach your girlfriend for the full amount - potentially thousands depending on how much the house has fallen in value.

As I said, if he is willing to take your girlfriend out of the equation just for the cost of the legal fees, then get it done quick before he comes to his senses.

Intel1982

Thanks for your advice it was very helpful.

Hooloovoo

Intel1982 wrote: »

Thanks for your advice it was very helpful.

If you gave some figures it would be easier to consider the options.

How much did they pay for the house?
How much is it valued at now?
How much deposit did he contribute?
How much deposit did she contribute?
Did they pay the mortgage equally?

If she is looking to get any of her deposit back (if she contributed any) then that makes things more tricky.